HK Stock Market Move | The reduction of industry inventory combined with the recovery of raw milk demand has led to a nearly 6% increase for YOURAN DAIRY (09858) and a rise of over 5% for CH MODERN D (01117).

Morning trading for the livestock sector saw gains; as of the time of writing, YOURAN DAIRY (09858) was up 5.98%, trading at HKD 4.43; CH MODERN D (01117) was up 5.38%, trading at HKD 1.665. In terms of news, the price of raw milk in major production areas turned positive year-on-year in July this year during the traditional off-season, combined with a continuous reduction in dairy cow inventory, leading the market to anticipate that the turning point for the raw milk cycle may arrive earlier than expected. Huachuang Securities pointed out that the degree of mapping from rising milk prices to financial reports depends on the elasticity strength, with the farm entities benefiting directly and having the highest elasticity. Recently, the interim reports released by CH MODERN D and YOURAN DAIRY indicated that both companies achieved profitability in the first half of the year. Guo Yuan International stated that under the ongoing reduction of industry inventory and the gradual recovery of raw milk demand, the livestock sector is expected to experience a cyclical reversal, with performance releasing elastic potential.